So, why aren’t their more such moments of positive shocks for the manufactured home industry?

Let’s look at the facts for some clues.

MH Cohesion?

Whenever the manufactured housing (MH) industry acted in a rational, and cohesive fashion, it has routinely been able to accomplish in Congress what it needed to do.

That’s true because at its heart, the MH industry has a great, and non-partisan story.

That’s what a dispassionate look at the periodic history of the industry reveals.

For example,

•in 1974, when the HUD Code was first passed into law.

•Or in 2000, when the Manufactured Housing Improvement Act (MHIA) was passed.

•And again in 2008, when the Duty to Serve (DTS) Manufactured Housing was passed as part of the Housing and Economic Recovery Act (HERA).

So when the industry acts cohesively it succeeds. So, why doesn’t it do so more often?

Big and Small…

Since before the founding of what today is called the Manufactured Housing Association for Regulatory Reform (MHARR), there’s long been a split between larger and smaller “independent” producers of HUD Code manufactured homes.

MHARR was a breakaway from the body that today is known as the Manufactured Housing Institute (MHI). MHARR was created precisely because of those differing points of view between bigger and smaller producers of federally regulated HUD Code manufactured homes.

“Consumer Groups” and Manufactured Housing

In several states, there are manufactured home consumer groups that emerged some years ago.

While “resident groups” engage on issues such as finance, those residents/manufactured home owner associations tend to focus on issues relating to land lease communities.

In California, there tends to be fast and hard lines between the MH Industry and resident groups.

Meanwhile, in places such as Ohio and Florida, those state MH Industry trade associations have at times meet and worked successfully with resident groups on key issues.

Non-Profits, Advocacy, and Manufactured Housing

Foundations and nonprofit groups have a history of positive interest in manufactured housing dating back at least some two decades.

For example, as a Daily Business News yesterday reported, CFED – which rebranded as Prosperity Now – is largely a serious and positive advocate for manufactured homes.

For years, CFED/Prosperity Now worked on projects that taken as a whole, promote manufactured homes as a tool for personal wealth building, especially for minorities, and lower income Americans of all ethnic groups.

CFED/Prosperity Now research has produced reams of documentation that arguably ought to be done by the Manufactured Housing Institute (MHI).

Based upon their overall positive work advocating for manufactured homes, it’s a little baffling for outsiders looking in to see conflict between MHI and Prosperity Now.

But conflicts do exist between MHI and Prosperity Now, on issues that include land lease communities, but also on financing. Prosperity Now has been a loud opponent to the Preserving Access to Manufactured Housing Act.

Like them or not, consider for a moment the perspective of Prosperity Now on these two issues:

•the issues of “insecurity” for residents in land lease communities,

•and MHI’s position – notably on higher points and fees that benefits primarily the Berkshire Hathaway owned manufactured home lenders.

Absent those two bullets, Prosperity Now should be seen by the vast majority of industry pros as a strong advocate for manufactured housing.

So why hasn’t MHI – the industry’s self-proclaimed “umbrella” and “post-production” association – found a way to work directly with Prosperity Now, when Ohio and Florida have found ways to work with their resident groups? Fair question, right?

So for any who believe that it is only MHI and MHARR alone who ‘can’t get along,’ they are mistaken or misinformed.

MHI, MHARR and Consumer Groups

This writer, while an MHI member – perhaps naively – attempted for years to get MHI and MHARR to work together.

This was one of the photos taken by MHProNews, reflecting routine behind the scenes effort some years ago to get MHI and MHARR to work more closely together. Richard Dick Jennison, MHI President and CEO, left, Mark Weiss, J.D., MHARR President and CEO, right.

The photo taken by MHProNews of Dick Jennison and Mark Weiss, J.D., shaking hands was just one tiny example symbolic of that effort.

MHI in meetings has reportedly told their members that the consumer groups “can not be reasoned with.”

Something similar has been said in MHI meetings about MHARR. One elected executive committee member stood at an MHI meeting a few years ago, and proclaimed that the “elephant in the room” was MHARR’s then president, Danny Ghorbani.

Yet as noted above, history shows that MHI and MHARR have achieved good things when they pulled together.

MHARR seems to have a better working relationship with the resident group, NMHOA than MHI does.

We’ll pose a question that we will leave dangling for now.

Why is it that MHI can get along with MHARR, but only at times?

Yet for most of the the past 20 years (+/-), the two are at odds, because one association arguably favors larger players, while the other fights for the rights of smaller, independent companies.

It’s against that backdrop of more tension than cohesion that the following undisputed facts ought to be considered. MHI hired a man a few years ago, part of who’s de facto job description was to recruit MHARR members into MHI.

Clayton and Cavco have in recent years both purchased companies that are MHARR members.

Is the trajectory of MHI’s and their larger members’ efforts to eliminate MHARR?

Dr. Carson, HUD, and Manufactured Housing

It is against that brief history that Secretary Carson must consider the internal political minefield of manufactured housing.

On the one hand, manufactured homes are just as “amazing” as Dr. Carson said.

The regulations and “guidance,” most notably during the Pam Danner era, have been just as “ridiculous” as Secretary Carson told that Senate oversight hearing, as the video above attests.

If MHI wanted to get along with the industry voices that don’t agree with them 100 percent of the time, logically the Arlington based group would only need to do is what it did at times when cohesion existed. Namely?

Listen, understand, and compromise.

MHI can posture beautifully, but it is their actions – not words alone – that must be the focus. Their members are buying up, and they are actively recruiting MHARR members.

There are MHARR members, and some in MHI, that believe that Pam Danner came to be HUD’s MH program administrator as part of a specific MHI team member’s efforts. If so, that means those “ridiculous” excesses are courtesy of one or more MHI staffer’s efforts.

Since:

•Danner was removed from the program a few weeks ago

•Lois Starkey was dismissed from HUD,

•and Danner’s overzealous and “ridiculous” regulatory burdens were put on hold by Carson and the Trump Administration,

an opportunity for a new beginning exists. What will happen next?

Absent trust and cohesion between

•MHI and MHARR, or between

•MHI and nonprofit Consumer Groups,

several risks exist.

Widely Recognized Fact

In finance, or production, in or out of manufactured housing, there is a simple principle at work.

The heavier the regulations, the harder it is for smaller companies to compete against larger ones. The following third-party research illustrates the point.

While MHARR was audibly protesting Danner’s work – and sought her removal from the MH program – by contrast, MHI went through various gyrations that did all — save ask for Danner’s removal. Odd? Or shadow boxing?

Let’s consider that as consistent with MHI’s apparent and alleged goal of acting in ways that are more burdensome for smaller companies (see Related Reports, linked at the end, below).

This is why CFED’s Doug Ryan accused Berkshire Hathaway (BH) of having monopoly power in manufactured housing over financing. While MHI all too often fails to respond to negative media, in that case their SVP Lesli Gooch leapt to respond and defend Berkshire brands in manufactured housing. By doing so, the Arlington association reflected anew who’s interests there dominate. Yet the fact remains, that 3 of the 3 largest MH lenders are owned outright by BH – 21st Mortgage Corp and Vanderbilt Mortgage and Finance (VMF), or they have a large stake in their company (Wells Fargo).

Doug Ryan, CFED/Prosperity Now, credit MHProNews.

When Democratic Congressional reps target Berkshire Hathaway and MHI – also using the words “near monopoly” – it should make CFPB, more in Congress, leadership at HUD and others in the Trump Administration stop and think.

Nonprofits, President Trump, and political voices across the left-right divide are calling “foul” with regard to giant companies dominating and pushing around smaller ones.

From as far left as the Nation to as far right as Breitbart, the issue of monopoly has been raised. The Nation specifically cited Warren Buffett’s Berkshire Hathaway and Clayton Homes.

It’s no secret that Buffett opposed Trump in 2016, by strongly supporting the candidate – Secretary Hillary Clinton – who favored the continued use of heavy regulations.

How many see various movements at work nationally, and in the halls of Washington, D.C.?

It’s Not a Vote…

The fact that many inside and outside of manufactured housing have raised similar concerns and issues about monopolistic power ought to be carefully considered by members of Congress and the Trump Administration.

Pam Danner, addressing MHI members. Photo credit, MHProNews.

MHI SVP Gooch’s Regulatory Comments Letter to HUD in January were overall good. But oddly, Gooch failed to mention:

who will replace Danner?

And what about the harm already done by Danner’s leadership to smaller independents?

Or why did MHI stand mute for years, and promoted Danner on various association event stages?

Reenergize?

Secretary Carson and the HUD team have a unique opportunity to reenergize the “amazing” manufactured housing industry in several ways.

The next steps taken at HUD and beyond could tell us who understands the fact that

with robust competition,

and unleashing the private sector,

that HUD could over time do exactly what Senator Tillis and the nonprofits alike suggested. Save tax dollars by liberating private sector produced manufactured homes. That, argued Tillis, will allow more dollars to be used for others that need a hand up.

That would achieve some of what advocacy groups desire: raising more people out of poverty using modern manufactured homes.

Save tax dollars, give more people a leg up. Learn more in the related research reports, linked below. ##(News, analysis and commentary.) (Third party images are provided under fair use guidelines.)

Clickhere to sign up in 5 seconds for themanufactured home industry’s leading – and still growing – emailed headline news updates. You’ll see in the first issue or two why big, medium and ‘mom-and-pop’ professionals are reading these headline news items by the thousands. These are typically delivered twice weekly to your in box.

Friends and fellow MH Pros, there are plenty of real attacks coming at us from outside of our industry. That’s not negative, that’s reality we must deal with. Dealing with it will reward us, failing to will only harm us.

Image credit, Google.

Recall the praise via video for MH provided by HUD’s Julian Castro, while per MHARR’s Mark Weiss, MH is having the screws put to us by HUD’s regulators? When one looks at the definition of schizophrenia, is it too big of a rhetorical leap to wonder out loud if Ryan and HUD are both suffering from a split personality regarding MH?

MHI has been loathe to publicly respond to PBS NewsHour, the Seattle Times, or attacks and problematic behavior like Ryan’s and HUD’s MH program.

“Silence,” says the old English proverb, “betokens consent.” Public silence on a serious allegation makes MH look guilty of something, when we have so much as an industry to be proud of in the day to day work done by tens of thousands of dedicated MH Pros.

Do I get it that some at MHI may think it better to let attacks blow over? Yes. But, I respectfully disagree. Why? Simple. Where have years of ignoring media attacks and bad news stories gotten MH as an industry?

Image credit, calculated risk.

This time, informed sources tell MHProNews, MHI has approached American Banker and has asked to respond publicly to the Doug Ryan OpEd. If true, perhaps our repeated calls for MHI to be more aggressive in responding to outsiders attacks may be paying off?

Like MHARR’s CEO, we still believe that the minutes of the meetings with MHI, FHFA and the non-profits about the DTS rule being applied to the GSEs should be made public. If there is any rationale for keeping such important issues away from the public eye, we welcome hearing or reading it. After all, the current president said his was supposed to be a highly transparent administration.

Unlike some on any issue or any profession who are unable or unwilling to take a nuanced look at a topic, we believe that one can agree on some issues, and disagree on others.

Like MHI, MHARR or others, we’ve long supported the DTS, and have raised that topic off and on for years.

UPDATE…Off The Record – from an MHPro…re: Doug Ryan’s American Banker OpEd:

Doug Ryan mistakenly thinks pixie dust comes with GSE funding. Unless the GSEs are willing to subsidize MH lending, the rate will never approach the comparable rates for median priced home loans.

MH has higher origination cost (as a percentage of the loan)

MH has higher servicing cost (as a percentage of the loan)

Default risk on low balance MH loans have higher default risk than median priced home mortgage. As does low price/low income buyers of inner city site built housing.

The only thing the GSE’s can deliver without a subsidy is access to the capital markets. There are costs and risk to the GSEs in providing this access and those cost and risk must be passed on to the originators of the loans.

Defense Can Score Points, Worth Billion$ to MH – Those Collective Billion Could be Worth 6 or 7 figures to Operation$ like Your’$

MHI has for years begged for new members, but the solution for any association to get new members is obvious. Make the value proposition so clear and appealing, that pros will gladly sign up. Claiming historic roots dating back 75 years, MHI has the depth of history that people want. MHI showing pros like you that they will defend the industry from any unjust attack, while promoting the good news about MH and member firms, that’s just smart association work. It’s in keeping with their own statement, in brown below.

We in MH must individually and collectively be working to WIN! Housing is a trillion dollar a year U.S. industry. MH is doing about 5 billion a year in sales. When will we collectively take the steps necessary to advance the industry’s cause successfully, so that MH professionals and investors can earn more of what the industry’s true potential is? We could roughly double new home shipments in about 12 to 18 months sustainably – perhaps more and faster – with the correct approaches. In 5 years or less, we could hit record levels, with the right touch. Now, think about what doubling new home shipments could be worth to you, your location, your company or association. Image credit, blah-blah, blah.

Let me stress this next point.

We don’t say any of this as part of an anti-MHI attack, nor any criticism of any MHI staffer. Rather, its simply a reality. MHI needs to be questioned, just as we get questioned, or we’ve questioned MHARR or others in MH at various times, when and as needed for the good of the industry. The reaction of MHI staffers who’ve been questioned ought not to be ‘lets find a way to get even‘ (not saying they are, just speaking rhetorically there). Rather, they should live up to what they say on their own website:

“MHI is the national trade organization representing all segments of the factory-built housing industry. MHI serves its membership by providing industry research, promotion, education and government relations programs, and by building and facilitating consensus within the industry.”

Consensus flows from discussion, from free-flowing of ideas that are open to being questioned or alternative approaches explored. Yet do all on staff at MHI actually apply that noble principle?

So today, we’ve spotlighted Doug Ryan/CFED’s faux pas, are anticipating what MHI will publish with American Banker, have shown the concerns expressed by MHARR’s members via their CEO and what an MHI member said in the bullet points above.

The Masthead is calling for a renewed spirit at MHI in keeping with their own statements and organizational goals. No one will cheer louder than we will when and if that happens, because when MHI does that, the odds they cross the finish line on proposals such as DTS, or Preserving Accesswill leap ahead. That will be good for the industry at large and for millions of MH owners and would be buyers.

Let me say anew, there is much that MHI does quite well. There are plenty of good peole who are MHI members and who work at MHI, just as there are in other associations, organizations and companies in the industry.

Screen capture from the bottom right of the MHProNews.com home page.

What’s Coming…

By way of progamming notes, we have a number of new features coming next week with the March 2016 Featured Articles. We’ll bring you a new A Cup of Coffeewith… a highly respected – historic, and widely known – industry pro. We’ll have at least two, perhaps more, new videos – one of which will include keen follow up insights on finance related issues. The new Tunica Show site is live, and we’ll have more udpates coming on the 2016 Tunica Manufactured Housing Trade Show. The new March 2016 issue is scheduled to go live on Monday night, Feb 29th. March madness – basketball, politics and MH Industry news, tips and views will all be upon us. Let’s make the end of the first quarter in MH for 2016 a good one. ##

L. A. ‘Tony’ Kovach, speaking at the 2015 New York Housing Association meeting. Tony will be presenting at the 2016 Tunica MH Show on March 22, more details, click here.

Reminder: like so many of you, we love the manufactured housing industry, and believe strongly in its future. Good news exists like the wine that cheers us ahead; troubling news is there for us to identify, navigate and overcome so our home owners and we as professionals can grow even more.

“The U.S. House of Representatives has approved an amendment by Rep. Peter Welch (D-VT) to increase the flexibility for low income families to use a Section 8 voucher to purchase a manufactured home. The amendment was approved by voice vote…”

Financial Services Chairman Jeb Hensarling (R-TX).

“This amendment, which was supported by Financial Services Committee Chairman Hensarling (R-TX) and Ranking Member Waters (D-CA), allows vouchers to be used not just for the cost of leasing the land (which is currently permitted) but also for other monthly costs of purchasing a manufactured home loan, including mortgage payments, property tax, and insurance. The change would allow families that receive a tenant-based Section 8 voucher to help pay for an alternative to renting an apartment – allowing them to actually purchase a home. The amendment does not provide any direct funds or require anyone to use a voucher to live in a manufactured home. However, with this change the approximately 2.1 million Section 8 voucher holders in America will now have the option to use their Section 8 voucher to buy a manufactured home.

“The broader bill that now includes this provision, H.R. 3700, the Housing Opportunity through Modernization Act, was passed by the U.S. House of Representatives by a vote of 472-0. It will now be sent to the U.S. Senate for consideration.”

Among the comments from readers on this was this:

“More than ten years ago at an MHI convention (name withheld) suggested to Barney Frank that this was the one thing gov’t could do which would help everyone. It went nowhere as he wasn’t listening.

Under the right circumstances this measure could be the most exciting thing since the HUD Code.

But, things are never as good or as bad as one thinks. This does however, have the potential to really help. Why piss away apt rent money? Let people use that money to buy their MH.

Now let’s see the details and hope for the best.”

The reason the Masthead will refer to this as DC Complexity is this easily overlooked part of the MHI release:

Maxine Waters (D-CA), ranking member, Financial Services Committee.

“This amendment, which was supported by Financial Services Committee Chairman Hensarling (R-TX) and Ranking Member Waters (D-CA), allows vouchers to be used…”

We shouldn’t look sideways at this potential for this gift to MH. Congressional Representative Waters is on the attack on MH on one topic, and yet supporting MH on this issue. That reveals how complex DC can be.

In this political environment, it doesn’t pay to burn a bridge in the nation’s capitol, does it?

The ongoing investigation of the industry, “The Mobile-Home Trap,” has focused on Clayton Homes, a company owned by Warren Buffett’s Berkshire …

In the wake of the above and related, we received this comment that was initially sent on the record by a well know industry leader, and then a follow up message requested it not be on the record.

“Tony,

In my opinion the Section 8 MHI posting and the DOJ investigation of Clayton Homes financial entities appears to be a concert conducted to appeal to the 98%ers and to get local NIMBY’s to remake the LLC communities into a new type of affordable housing.

The goal is to offset troubling local affordable housing issues nationwide. Since Socialism and Rent Control appear to be a Democrat and Progressives theme and a claim to equality in housing. Only one “Gotcha” is needed to validate and prove Clayton Homes finance arm’s troubles.

The trend and recent actions clearly shows a path to change for the future of HUD (Code manufactured) housing.” (Editor’s note – the words “Code manufactured” – was implied, but not in the original, and was inserted above for clarity of meaning).

Follow ups made it clear that this writer wasn’t throwing someone under the bus, nor necessarily favoring what is happening on this issue. Rather, that professional suggests that the HUD Code MH and MHC industries are being forced into changes, whether it wants them or not.

About Lesli Gooch’s Op-Ed

Marty Lavin, JD looking happy and trim in the dining area of his winter residence in Miami Beach, the 70′ custom Italian ship, the Spy Sea.

Marty Lavin, JD, is a successful, award-winning attorney who’s business interests included MH lending, communities and retail sales. His opinion is worth noting, because he worked with one of the GSEs during the 2000s. When he read Dr. Gooch’s OpEd, he shared the following comment on the record to us:

“I think Dr. Gooch is very well intended, but the industry position doesn’t necessarily align with the ends of the GSEs. Perhaps a better understanding of their position might lead to a better outcome…if that is possible. It’s much more than just helping consumers buy homes. The GSEs need these folks to be able to stay in them. Therein lies the rub.”

Once more, a close reading of his observations aren’t a slam on Lesli Gooch, or MHI. Marty Lavin has years of experience working with a particular GSE. He understands where they are coming from. Lavin is applying good reasoning: in the absence of meeting the GSE’s concerns, he believes they won’t voluntarily budge.

MHI-itis?

This leads to a broader issue, one we’ve raised in a slightly different way before.

What is keeping MHI from achieving its goals?

Yes, among other factors, there’s opposition in DC from so-called consumer groups. But those same groups claim to champion manufactured housing as a good solution for affordable quality living.

Manufactured housing and its lending ought to be seen as non-partisan issues. Yet all to often, it’s precisely in political and ‘crony capitalist’ terms how MH and it’s lending are being portrayed. That’s tragic, because the status quo is harming millions of owners of low cost MH, and untold thousands of buyers annually who in pre-Dodd-Frank had financing, and thanks to the CFPB’s 2014 implementation of those rules, today do not.

We know that DC works differently than many states do. But the principles are similar. State governments and the federal government mirror each other in the sense there is an executive, legislative and judicial branch and then there are executive branch agencies that enforce rules and regulations. There is lobbying at the state level akin to what happens in Washington, DC.

We know a number of MH state associations that are getting the job done for their members, while working in concert whenever possible with consumer groups. Let’s suggest that’s a model that MHI needs to better implement.

Ishbel Dickens, NMHOA, photo credit Madison Park Times.

Why? Until we either get consumer groups on the same page as the industry – for the sake of consumers and for

Doug Ryan, CFED’s point man on manufactured housing.

professionals alike – there exists an often adversarial relationship with non-profits such as Ishbel Dickens of NMHOA and Doug Ryan at CFED, to name but two examples.

Those groups are linked with what is going on in the ongoing media war launched against Clayton Homes et al, as the Center for Public Integrity’s own release indicates, “The ongoing investigation of the industry, “The Mobile-Home Trap,” has focused on Clayton Homes, a company owned by Warren Buffett’s Berkshire…”

Image credit – collage of Industry Association logos by MHProNews, each logo is the property of their respective organization, and is used here under Fair Use guidelines.

DC Talk and DC Complexity

Once more, your Masthead scribe will be in DC to listen to what is going on there, first hand. The rules of the association are clear. I can’t report on what goes on in the meeting, but what is said in the hallways outside the meeting rooms and beyond the event are fair game.

We’ll see what that hallway and beyond – DC talk – will reveal.

We still want to see S 682 passed, because it is good for consumers and good for the industry. There are those who say Preserving Access is “dead, dead, dead” – that we might at best save the MLO comp rule portion of it.

Another well placed source says the entire bill is still at play, and that’s exactly why the Seattle Times et al are continuing their assault on MHI’s backed bill.

“MHI Mission Statement – MHI is the national trade organization representing all segments of the factory-built housing industry. MHI serves its membership by providing industry research, promotion, education and government relations programs, and by building and facilitating consensus within the industry.”

Let’s ask: is this mission statement being fully lived up to?

If the mission statement were a reality, would we be further along or perhaps have even already passed the highly modest CFPB/Dodd-Frank reform legislation sought in HR 650-S 682?

What the high numbers of comments, forwards and thousands of reads on our recent Masthead on a related topic suggests is that change must come to MHI, the only question is how and when.

Graphic credit, OpenSourceway and FlickrCreativeCommons

We want the bill passed, for reasons noted numerous times over the years. It might get passed with no changes at MHI, just rocking along with business as usual there. But my sincere concern is that without change, we are whistling in the wind.

I’m looking forward to visits on Capitol Hill.

We’ll catch up with another Masthead after the MHI meetings, perhaps next Wednesday.

Until then, stay current with Matthew Silver’s Daily Business News, and you’ve simply got to read Jan Hollingsworth’s latest:

I’m picturing a manufactured home community owner who was standing at the entry door in the back of an association meeting. He looked stunned, bewildered and lost. When asked, he tried to express to me his frustration, and sense of helplessness, over federal finance regulations that hit his business. He’d served MH owners and buyers for decades. Now, it was all changing so rapidly, his head was spinning.

Next image was another MHC owner, in different state and another association’s meeting. That man explained how his family business jumped-the-hoops to get an MLO on staff. However, that MLO left him after a few months. Their volume of loans was too low, he said, to keep someone. This MHC owner was trying to comply with rules that did not help buyer or seller, as they made no money on financing of a home. “Angry” is how I would describe him.

Retailers and others have approached me at trade shows like Louisville and Tunica, often to vent. Sometimes, they wanted to explain that they were trying, but afraid that all these changes would drive them from the business they’d worked in for x number of years.

Odds are good you know stories like these. Maybe you have one of your own?

Image credit – KY Olsen, Flickr Creative Commons.

The other stories going untold

Then there are the MH home owners who can’t sell his under $20,000 home for what it was worth, because once the CFPB regulations hit, lenders that made those loans pulled out from that segment of the MH market. It was no longer possible to make those loans without more risk than their was chance for profit. Yes, we’ve spoken or heard from consumers impacted too.

Closed cash bag…Photo credit, WikiCommons.

If you love all the ways that the Consumer Financial Protection Bureau (CFPB) is implementing regulations relating to on manufactured home financing, brought on by 5 year old Dodd-Frank legislation, save sometime and stop here.

On the other hand, if you feel that the regulations should change, that MH homeowners and businesses need to speak up NOW…then please do two things, right now today. Both are easy, 10 minutes and you’re done.

Photo credit -SHPO. Please click on the photo above to take you to the Congressional Blog, its awaiting YOUR comment.

Please read this article linked on The Hill’s Congressional Blog, Congress and their staffs, Policy Advocates, the CFPB, the media and others read this blog.

Briefly tell your own story in their comments section. Congressional staff, House and Senate Members, regulators and even the WH reads The Hill

Here are 4 MH Industry examples…

...please join them. Perhaps 5, 10 minutes and you’re done.

Don’t curse the darkness, light the candle. Yours. Don’t wait for someone else to do it, you be the one. Let’s let DC know that this issue matters to manufactured home owners and businesses. HR 650 passed the House by a wide margin. The Senate vote looms. Send a messge. ##

Ten days from today, the CFPB imposed appraisal rule for manufactured housing goes into effect. There are those who suggest that this is a consumer protection. That reminds me a bit of the Ronald Reagan punch line, “I’m from the government, and I’m here to help you.”

No lender wants to finance a home for more than it’s reasonably worth. For decades, there has been ways of getting a third party appraisal or estimated value on a manufactured home that was selling either chattel or as part of a land/home package. The new rule is focused on home-only transactions, those not in the CFPB’s QM (see the top two links above).

So because a smart lender wants to make a good loan, there was already consumer protection in place.

Because MH lenders are lending their own dollars – vs. government-backed loan dollars – by MH lenders protecting their interests, they are also protecting those of the consumer buying the home. That’s the natural beauty of the free enterprise system at work. A lender won’t knowingly finance a home for more than its worth, thus the consumer isn’t paying more than a home is worth.

Because government is far from free – every regulation has a cost and impact – the CFPB’s new rule is simply adding a new layer of expenses on businesses. Sooner or later, those government-imposed added costs have to be paid by John Q. Public, or those businesses won’t stay in business.

Please note that nowhere in her column on the CFED blog has McKay refuted any point made about their alleged conflict-of-interest or our other various reports on the negative impact of CFPB regulations on MH owners or potential customers. Ms. McKay simply recycled the same talking points that Doug Ryan used before her. By the way, Mr. Ryan, what happened to that video debate on the impact of CFPB regulations on manufactured homes you were going to do with me?

Part of the comments posted by CFED and MH Pros to date. To see all, click the link here or the image above. Note, we credit CFED for leaving the comments posted up, and have been doing screen captures on them periodically.

One last point for now about Ms. McKay’s column. Stop and think about her title:

I’m Home Fights Back Against Regulations that hurt Owners of Manufactured Homes

We can only hope for that today!

What they published in their headline was a faux pas from their own viewpoint. They aren’t pushing back on regulations. Rather, what they want to do is fend off the proposed reforms to amend CFPB regulations. So not even their headline is logically correct. Should you decide to read Ms. McKay’s column (see link below the comments graphic or click on the comments graphic), do make sure you read the MH Comments posted there.

We have sources telling us that a national news outlet will be covering this MH finance issue on TV in a few weeks. More on that and other pending MH news in the media, soon.

Thanks to those who see a government solution to almost every imagined problem, consumers now have a new rule that impacts manufactured home retailers and communities just days away. What will the impact of the appraisal rule be? Time will tell, but you don’t have to be a rocket scientist to see why there needs to be a re-balance in how business is done in DC. If you missed the two prior Masthead posts, kindly check them out.

In closing, we empathize with those who want to do right by consumers and the public. I don’t doubt there are many who act with good intentions. We are pleased that CFED and others see the intrinsic value and growing need for manufactured homes. On those levels, we have and continue to applaud them. We’ve given CFED positive digital-ink before, and would gladly do so again, should they change course by correcting their clear errors on this financing topic.

But the time is now to see how those good intentions have actually played out in the real world. We must look at how those CFPB regulations have actually impacted the marketplace! CFED et al can just look at the chart above, courtesy of the Wisconsin Housing Alliance, to see how in their state, the number of lenders making loans on MH dropped like a rock once the CFPB regulations went into effect.

Less lending? How does that help MH consumers and businesses? CFPB/Richard Cordray, are you listening? Seattle Times/Center for Public Integrity, are you seeing the facts linked above that you somehow managed to overlook in your reports?

Our sources tell us that a new anti-HR 650/S 682 push looms. Expect it to be visible anew in the media. The Preserving Access to Manufactured Housing Act is just one battle in a longer struggle against over-regulation. Its a battle that the opposition is fighting hard to win. What are you and your associates doing to make sure that we protect more MH consumers by getting that bill passed in the Senate and signed into law? ##

The Wall Street Journal’s recent report on emails that documented Jonathan Gruber’s ‘heroic’ roll in putting together and passing the misnamed Affordable Care Act (ACA, aka ObamaCare) is just the latest reminder that public officials at many levels have embraced the strategy of Josef Goebbels, Adolf Hitler, Joe Stalin or Chairman Mao.

“If you tell a lie big enough and keep repeating it, people will eventually come to believe it.” – Josef Goebbels

Should the intelligent laugh or cry when ‘StartUp NY’ – their state funded commericals – runs their zero-tax ads for new or expanding businesses on networks like Fox News? On the one hand, it contradicts the tax-the-rich views that NY, CA or other mostly D run states tend to have. Yet we know President John F. Kennedy (D) and others took positions that lowered taxes, and grew the economy in their wake. The Communists in China, along with now-booming economies that once were so-so, grow today due to easier regulations – and/or lower taxes – than what we see coming from high tax states like NY (they are rated near the bottom on most business climate lists) or for that matter, coming out of DC in recent years.

It is not my goal to carefully analyze the NY plan above, but perhaps the reason that Forbesreports this program as getting off to a slow start is because the prospective business person has to wonder, ‘Okay, what happens to me in NY at the end of ten years?’ Uncertainty, we’ve all heard from the investor class, is harmful to business and growth.

Photo credit WikiCommons. Poster Credit – MHProNews.

Growing an economy here in the U.S. is not magic! “The power to tax is the power to destroy.” Likewise, the power to regulate is also the power to destroy.

So the reverse of the above implies that lower taxes and easier, common sense (vs CFPB style) regs fuels the kinds of growth that made America great. Herein lies one of many MH connections to the importance of truth-telling and the goal of policy sanity we in MH should seek. Sure, we ought to fight for HR 650/S 682, but we are wise to also look at a longer term plan that promotes a healthy business climate for all in America.

Self-avowed socialist Bernie Sanders’ campaign to be the Democratic presidential nominee is driving Hillary Clinton even further left. The reason I’m a political independent is because Republicans – who tend to be more for free enterprise – can at times play footsie with the facts or simply make bad judgments, as in the case of too many Rs being on board with the Trans-Pacific Partnership trade bill. If it is such a great trade bill, why all the secrecy?

When truth is harder to find, a responsible person goes to more sources, then applies reason to sort it all out. So your scribe reads the New York Times, Fox and a spectrum of sources – domestic and international – to triangulate reality vs. the various party lines.

Let’s see how all of this applies to MH.

The Truth Matters

It is useful (above) to cite examples outside of our arena of immediate self-interest to make a parallel point. The truth about MH matters. The truth about MH lending matters.

Doug Ryan, CFED’s point man on manufactured housing related issues.

Yet we see forces like Doug Ryan led CFED – who are pro-MH on their website – take a position proven to be contrary to the interests of MH home owners, businesses and by extension, America in general.

Some say truth is relative. They’re only half-right. The truth of your taste or mine, that’s ‘relative’ (meaning, subjective or personal). But gravity – for example – is not subjective. Gravity exists. The truth could be defined as ‘what is.’ The iPhone 6 Plus I’m typing this draft of my blog on, it is – it exists – even if no one besides me believes in it or knows it exists.

So there are both Objective Truths and subjective truths.

That said, the truths of MH we strive to focus on are objective realities. The combination of Objective Truth, and the subjective praise from MH home owners is what is making MHLivingNews.comthe positive force it is for those owners, and the professionals of our industry.

Is it any wonder there are sales being attributed by MH pros to stories on our public-focused sister-site? Or is it any wonder that the traffic – already good! – on MHLivingNews doubled in April, and then doubled again in May? Is it any wonder that views of the Dennis Raper video, which went live only 5 days ago, have skyrocketed?

It is simply amazing to think that a home like this could be purchased for around $40 per square foot! We must share the evolutionary truth that modern manufactured homes started out as trailers, became ‘mobile homes, and now today are the eco-friendly, amazing home value that this article linked here explains to the public.

We don’t make it easy for people to find my phone number or email from MHLivingNews. Yet, we are seeing a growing number of home seekers calling my office to ask questions about:

> who to buy from,

> where and how to shop for an MH,

> or who to turn to for MH financing.

The truth well told is powerful. We have the right to our opinions, but no one has the right to make up their own facts. The truth – reality – matters. You don’t want to be deceived, right? You don’t want to be lied to about something consequential, correct? These are proofs that at some level, we all know that truth exists and that truth does in fact matter to us, and thus should matter to others.

It is my sincere hope that SCOTUS gets it right on the ACA when they hand down their decision. Lies should not be rewarded. It is my hope that Ryan/CFED will own up to their apparent conflict of interest, and reverse course to support MH home owners, MH shoppers, MH Lending and MH job creators.

We don’t have to exaggerate to make the case for MH. There were two old TV shows whose titles that come to mind. “To Tell the Truth” and…

…“Truth or Consequences”…

We’ll look at the profitable power of truth-telling in more details in our rapidly approaching July issue of MHProNews. ##

“A good compromise, a good piece of legislation, is like a good sentence; or a good piece of music. Everybody can recognize it. They say, ‘Huh. It works. It makes sense.‘” – Barack Obama.

There is momentum behind the common-sense changes sought by the Preserving Access to Manufactured Housing Act (HR 650/S 682). MHProNews has sources that suggest that the bill could clear the Senate when it hits that chamber’s floor for a vote in late summer or this fall.

If that Senate passage happens, then the question will become, what will the president do should the bill hit his desk?

The White House is correct that millions want to own homes, and can afford them. Will they therefor support the common sense reforms sought by HR 650/S 682? Image credit: FlikrCreativeCommons.

“Still, homeownership is out of reach for too many Americans — families who can afford to buy a home, but find themselves shut out because the lending market is too tight.” – White House website. (January 7, 2015).

One big reason the MH ‘lending market is too tight’ is regulatory. MHProNews and MHLivingNews have documented step-by-step though various reports cited below that demonstrates how the reforms sought by the manufactured housing industry are good for consumers. HR 650/S 682 is also needed by current MH home owners; notably those who have homes that would sell for less than $20,000.

Thousands of shoppers came – even in the cold rain – to the Eastern Ohio Manufactured Home Show. The demand for our homes is strong and growing. Will the CFPB relent in their choaking off the aspirations of tens of thousands of would-be MH buyers a year, from lenders willing to risk their own capital on loans where the ability to repay has been proven?

The hand-written note obtained by MHProNews was part of a longer reply by the CFPB’s Richard Cordray to a bi-partisan group of U.S. Senators. Those senators asked for common sense changes to regulations on MH lending. What Director Cordray’s note completely ignores is the fact that MH lenders portfolio their loans; they don’t go to the secondary market. MH lending had ‘less than zero’ impact on the 2008 financial crisis. Thus, Cordray’s argument is logically flawed, as an association leader told MHProNews off the record.

Applying President Obama’s quote above to HR 650/S 682, this reform would make good sense for the Powell’s and thousands like them every year who are forced to choose between more renting, or paying an outrageous rate on a non-MH lender’s loan. More, competitive financing would return to the market – originated by firm’s such UMH and others referenced below – and they are only a regulatory or statutory change away. “Huh. It works. It makes sense.” – Barack Obama.

Triad Financial Services Chairman, Don Glisson, Jr.

Veteran MH lender Don Glisson Jr.’s on-the-record statement shows how a reasonable modification of the MLO rule, would make it as easy for an MH sales person as it is for a real estate agent to advise a prospective home buyer. Those MH sales professionals aren’t getting paid by the lender. Where is the risk in letting MH sales people do what real estate agents do?

The current state of the CFPB’s regulations umjustly muzzles the free speech rights of professionals, and thus harms the consumers they serve. The proposed law (HR 650/S 682) helps fix that issue. “Huh. It works. It makes sense.” – Barack Obama.

Let’s note too that MH lenders portfolio their loans. They ‘hold their own paper.’ The loans they make are thus very different than those that caused the financial melt down of housing and the mortgage market in 2008 that gave rise to Dodd-Frank.

We privately and publicly called out The Seattle Times and Doug Ryan/CFED on such topics. How can they defend the apparent errors in their positions and their own conflicts of interest we spotlighted?

Rents are rising in many markets, due in part to the impact of potential buyers being denied access to credit. CFPB policy on MH lending is thus costing the federal government money in their affordable housing subsidy programs. Applying President Obama’s words to MH lending would benefit government budgets, as well as home buyers and business people too.

A Google search we did last night on the Seattle Times and CFED revealed…silence. See the screen captures below. Our facts, or those reported by Professor Cunningham (see link below), have to my knowledge gone unanswered. Why? Could it be that both the Seattle Times/Center for Public Integrity and Doug Ryan/CFED are in a conflict of interest? Isn’t it apparent they have no good response to the fact-based reports and common sense we’ve brought to the public discussion of HR 650/S 682?

As the Pledge of Allegiance reminds us, we are a Republic. A nation under laws that are supposed to protect “We, the People.”

The current structure of the CFPB demonstrates that it’s unresponsive to the very body – Congress – that breathed it into regulatory life. As the president once said, he is not the emperor. Nor should the CFPB – or any other regulatory body – be so independent of those representing the American people – Congress – that it is essentially unaccountable for its actions. I’d suggest that the current state of the CFPB regulations of MH financing is un-American, and perhaps un-Constitutional too.

The CFPB must be reigned in. With respect to its current policies regarding MH financing, it is demonstrably harming millions of Americans who own those MHs under $20,000. The CFPB is hampering the access to credit and home ownership which the applied logic of the White House’s previously cited statement wishes to correct; again quoting – “Still, homeownership is out of reach for too many Americans — families who can afford to buy a home, but find themselves shut out because the lending market is too tight.”

The GAO 2014 report dramatically demonstrates that even with a somewhat higher interest rate than conventional housing (which is indirectly subsidized by the federal government), MH is so affordable that it is the lowest cost form of new permenant housing in the U.S. today.

We support passage of HR 650/S 682 because it is good for consumers, good for home owners, good for job creation and good for business. That meets all of the criteria President Obama has frequently outlined as being good for America.

We hope President Obama and all Senators who care about the millions currently being harmed by existing regulations will join the strong majority in the House or Representatives and support Preserving Access to Manufactured Housing – the most affordable form of quality, greener, appealing homes available to Americans today. ##

References, Sources and Footnotes

Dodd-Frank and Manufactured Home Financing – the Place where Good Intentions and Unintended Consequences Collide,linked here. The article demonstrates that MH lenders are about 2/3 lower in interest rate than the kind of financing Eric Powell was forced into, due to policies supported CFED and enforced by the CFPB. The nuances of MH lending are reviewed in terms that make sense, and which undercut the false arguments advanced by Doug Ryan et al. MH lending experts are quoted in this article, as is Doug Ryan.

Don Glisson Jr., Chairman and CEO of Triad Financial Services, on his company’s experiences and reasons for supporting reforms of the Dodd-Frank Act to correct problems created for manufactured housing lending by current CFPB policies.,linked here

Sam Landy, JD, UMH Properties CEO, and other lenders who have been pushed out of the market by current CFPB policies. It is noteworthy that the facts Landy and others present undercut Doug Ryan led CFED arguments and vividly proves that CFPB polices are costing untold thousands annually access to home ownership. See article and video,linked here. It must be noted that ManufacturedHomeLivingNews has contacted every major and some regional MH lenders. All favor changes to current CFPB regulations, so this is not a Berkshire-Hathaway/Warren Buffett issue.

Alan Amy, a veteran MH retailer, estimates that current regulations are depressing MH sales by about 30% a year. If so, the practical impact is that 20,000 more homes could be sold a year at the current pace and 20,000 new “good-pay jobs” could be created in the construction of manufactured housing. Amy’s comment came as part of a broader video interview,linked here.

The Integrity of Clayton Homes and the Politics of “Investigative Journalism,” published by Professor Lawrence A. Cunningham, JD. Cunningham’s arguments have yet to refuted by The Seattle Timeset al.Article linked here.

One must also question why Daniel Wagner and Mike Baker, writing in the Seattle Times articles done in tandem with theCenter for Public Integrity, used outdated and inaccurate terminology when referencing modern manufactured homes, improperly calling them ‘mobile homes.’ Was it a tactic on their part? For a better understanding of the terminology and why-it-matters, see the article linked below.

Screen captures of Google Searches, shown below, demonstrate that neither CFED nor the Seattle Times have yet to refute the points noted in our MHLivingNews or MHProNews reports on these topics.

##

L. A. “Tony’ Kovach is one of the most prominent experts on the MH scene. Kovach has interviewed more MH customers and experts than any other journalist today. Kovach began his MH career in 1981. Shown here in an educational session in Louisville, KY.